I would like to see Blue Oregon readers address the May 18th story in the Portland Tribune regarding the Portland Development Commission, the city council, and Trammell Crow Residential's decision to pull out of their agreement to build low income units in downtown Portland. If you can call $850 a month rent for a studio apartment low income (workforce) housing. I call it a figure that will ensure the residents will never be able to save enough to purchase their own home anywhere in the metro area.

With minimum wage and even mid-range wages so out of proportion with housing costs, and the rising cost of living in general, why has the PDC only just recently been required to devote 30% of their budget to solving this problem? Is that enough? I don't think so. Is the PDC living up to its definition, or a wolf in sheep's clothing draining civic resources?

It all seems so penny-wise and pound-foolish to me. All over the country workers in the service industries and other low pay jobs, cannot afford to live in the cities in which they work. With the runaway cost of all modern life's essentials, they will not be able to drive to these jobs either. Mass transit is not always the practical answer, even if you don't mind spending hours every day waiting for buses and slogging through bad weather, which I am sure the city council and PDC members don't do. There are many pockets of the metro area where you simply cannot "get there from here". What will we do when the folks who pump our gas, concoct our lattes, and clean our offices can no longer afford to come to work?

I think the city council and PDC are truly out of touch with reality. A simple on-paper budget exercise, based on low to mid-income wages less taxes, might open their eyes. (I suspect they really are not interested in these uncomfortable facts.) Looking at a low-income budget should be required of all members before they are allowed to make any decisions on behalf of the taxpayers who cover their salaries out of their paltry paychecks. These people are the cogs of the machine that make the city work, and they are being squeezed out on every front.

It seems to me Portland's civic answer to affordable housing is filled with hubris and hypocrisy... paying for sanitary service hook-ups for Dignity Village, and making sure there is funding for police to make sure the homeless don't sit on the sidewalks.

What good will it do the city and PDC to spruce and fix and try to entice new business to set up in PDX, when the cost of housing is so high workers cannot afford a decent quality of life? The cost of living is one of the first things corporations consider when choosing a new location. All the tax credits and perks (and parks) the city offers will not change that fact.

The need for affordable housing for low and middle income workers is urgent... now. It seems to me, through all the stalling and controversy their plight has been forgotten. Or perhaps just used as a politically correct hot button for developers to get a cut of the PDC pie?

Comments

Mary -- I agree with you that affordable housing is an important issue, but I think this Trammel Crow case illustrates how the City Council is getting more involved, not less. This particular deal was structured by PDC (without City Council involvement) and would have given a tax abatement to Trammel Crow in exchange for those $850 studio units. The Council decided -- I think correctly -- that the price of the tax break was too high given the "affordable housing" the City was getting in return. So while the affordable housing didn't get built in this particular project, the City is going to collect millions in taxes from Trammel Crow that it wouldn't have collected otherwise.

Regarding the overall issue, I have yet to hear any real solutions to the problem of affordable housing. It's a problem everywhere, and in fact Portland is in better shape than other west coast cities. But absent projects (double entendre intended) to build public housing, what can the City do?

Some would argue that housing would be more affordable if we got rid of the urban growth boundary and invested in lots of new roads to move people from outlying areas to the city and back again. They're probably right -- but that reduction in housing prices comes at a high cost to our environment and the metro area's livability.

Why do I feel conflicted when it comes to affordable housing. The working poor need appropriate housing- I feel that this is extremely important

Conversely, the apartment complexes in my SE neighborhood are hubs for property crime and mayhem. We have an apartment complex 3 blocks from our house, and while walking my dof I have seen tenants urinating on the street and drinking in public. The pathway between these apartments and the mini mart for cigarettes and malt liquor are routes that suffer huge amounts of property crime. My neighbor's son has had his bike stolen 6 times in three years from his front porch.
A serious discussion needs to happen in regards to affordable housing. There are families living on the streets, and all of the " affordable housing " in my neighborhood is being taken by tweakers and petty criminals.
Maybe a screening process? I don't have any answers, I am torn. I want housing for those who need it, but I don't want to invite some of the tenants who only want to disrespect our community into my neighborhood.
Please help me feel like a liberal again!

Just since December, when we moved into our new apartment, we've noticed a change here in the complex. College students are moving out (because they've finished at Mt. Hood CC and are going elsewhere, are moving away to start a family, etc.) and families are moving in instead. When we visited the property, it was packed with college students-- many of which had roommates so they could get a 2 or 3 bedroom unit, which meant more space and less rent.

But now everywhere I look, families are moving in. I think it has a lot to do with what is considered "affordable" in Portland. I'm always shocked when a 3 bedroom unit at $1000/month is considered affordable. $850 for a studio is even worse.

Here, we get a 3 bedroom unit, on the bottom floor, with direct access to a large grassy area off our patio for less than that. And the crime in this area doesn't seem bad, thus far. We moved away from our other unit for a variety of reasons, including increased crime and the Wal-Mart that may end up at 182nd/Powell.

The families are, for the most part, coming from Portland. The school here is already a bit worried because it looks like their incoming groups of students could be considerably larger than before.

This lack of affordable housing in areas without high crime has a lot to do with the families moving out. Combine that with the mess PPS has become, and families are going elsewhere.

Of course the downside is that public transportation isn't great out here. There are sections of major roads, like Burnside, without bus access at all. Many residents don't live anywhere near a bus stop. Which means they have to continue to use their cars to get around.

Mary Tinkler
The need for affordable housing for low and middle income workers is urgent... now. It seems to me,
JK: It is.
I maintain that many Portlander’s could not afford to buy the house the now live in (having bought years ago.) I also think that the politicians don’t have a clue as to the cause and only propose bandaids, instead of attacking the root causes.

One politician recently pondered how many new units do we need to build before the price comes down. Of course, the answer is they will quit building when the cost of building exceeds the selling price - you cannot build your way out of high cost housing. You must lower the actual cost through building with more economical methods (high rises are inherently more expensive), build smaller units (which families don’t want). But it will be difficult to build affordable $130,000 homes on land that costs $100,000 per lot.

Land costs are high because the supply is artificially restricted and the average home purchaser is paying about twice what a house should cost if land were freely available. This is directly Metro’s fault with its policy of maintaining an artificial shortage of land. We will never again have affordable housing until Metro tears down its wall. Our rally should be: Metro: Tread down your wall!

There are links to good studies on this topic at PortlandFacts.com/Housing/HousingCost.htm

Mary Tinkler through all the stalling and controversy their plight has been forgotten.
JK: Not really, they never counted. Only people who can deliver votes (or money to get votes) count. See PortlandFacts.com/Owns/CE-041003-LargeAmounts-ByAmount(over$1000).htm

Mary Tinkler Or perhaps just used as a politically correct hot button for developers to get a cut of the PDC pie?
JK: Helping the low income is a good headline getter, unfortunately no one looks to see if any of these schemes really work.

One immediate thing that can be done is to stop using ANY government money to tear down low cost housing. Like the stadium apartments and coming soon the Jefferson building. I think both are PDC’s work.

As a former (one of many) PDC employee I’d like to share some observations. I don’t have the answers for these issues but I’d like to think they are informed opinions.

Increased oversight of PDC by Council will make things worse not better. City Council members are looking at PDC as a bank to fund their pet projects. Unfortunately most of them don’t result in increased tax increment and the golden goose that has done so much good for the City is slowly being strangled.

The smallest and least funded department in PDC is the Economic Development Department. EcDev works hard with what it has to help create and foster living wage jobs. No other city of its size in the country spends as little on Economic Development programs as Portland. Isn’t providing living wage jobs for citizens a positive way to improve living and housing conditions for families? The thirty percent low-income housing set-aside resulted in a seven million dollar reduction in the Economic Development Department’s budget from fiscal year 06-07 to 07-08.

The whole point of an urban renewal agency is to provide incentives for business creation, job growth, and housing development (from low income to market rate) in depressed areas where the market fails to do so on its own. You do this through appropriate subsidies be it reduced land prices or tax abatements.

Portland’s City Council seems to have lost sight of number three and are eliminating the tools the legislature and citizens have given them for short term gains and seeing their names in the paper.

The thirty percent housing requirement is not going to result in anything other then more low-income apartment complexes that are run by non-profits. Housing is not the only PDC department finding it difficult to find projects that create tax increment. Many current development projects are with non-profits (Mercy Corps) or government entities (U of O) that don’t pay taxes. These projects will not directly result in increased property values or increased tax increment, something that is needed for PDC to repay the bonds it sells to finance these programs. While the goal may be worthy the tools being used are inappropriate.

PDC is an Urban Renewal Agency, not the City’s Housing Bureau or City Council’s personal piggy bank.

The answer is: more supply. Even if that new supply isn't for low-income people, a "trickle down" effect will lift all housing boats.

Don't want suburban sprawl? Then allow higher densities within the existing urban area. Instead of subsidizing suburban sprawl, subsidize the housing more people want, high density transit friendly city housing. Yes Karlock, I know you don't want to acknowledge it, but "Ozzie and Harriet" are a shrinking minority of households. A modest amount of new housing on the urban fringes (which Metro is working to provide) will satisfy the remaining demand for such housing.

Want to help really low income families? Don't put them in housing ghettoes - give them vouchers to spend on housing to supplement their incomes, to be used to pay any landlord willing to have them.

I'm glad those PDC deals fell through with Trammel Crow. TC is used to bending the rules quite a bit to get what they want.

============================

While high rises may cost more to construct, low and mid-rise structures are inherintly less expensive than stand-alone houses, because you don't need as much building envelope per unit. Also, the units are more ecologically friendly, as they have smaller footprints:

-less material used in structure than high-rise buildings*
-much less heat loss due to shared walls, ceilings, and floors with other units - than a stand-alone house

Not to mention higher density neighborhoods can support a greater amount of amenities, such as grocery stores.

Unfortunately, considering how much materials have increased in price the past decade, it may be unrealistic to expect that you can rent an affordable 1,500 ft^2 apartment for less than $1,000 a month, of new construction.

*The intricate financing used by banks and developers can also mean that it is beneficial to build taller than shorter in many instances - but, rest assured, as you build a taller building, seismic and fire/life safety codes become more stringent - and require more expensive solutions.

Much if not all of the permit process needs to be reduced and or repealed. The costs of permits last time I looked for a home was foolish. Not noticed in much of this is that every dollar that the government adds on to home construction ends up in the mortgage and since most Oregonians send the mortgage payments to out of state compamies that means those dollars for the permits are going out of state as well. All of this is a drain on the local economy created by the government.
MW

Dave writes: Increased oversight of PDC by Council will make things worse not better. City Council members are looking at PDC as a bank to fund their pet projects.

I call bullshit on this, Dave. City Council oversight will bring some accountability to PDC. There is absolutely no reason why the City agency with the largest budget (PDC) should be the agency with no direct oversight by the voters. Thankfully, the voters just remedied this with the PDC charter changes.

The whole point of an urban renewal agency is to provide incentives for business creation, job growth, and housing development (from low income to market rate) in depressed areas where the market fails to do so on its own. You do this through appropriate subsidies be it reduced land prices or tax abatements.

PDC's problem is that they never did an objective cost/benefit analysis on these projects. Look at the subsidies that PDC has been handing out, in return for minimal promises from developers. When you ask PDC for data to justify their decision, they either refuse to provide it or acknowledge that they didn't do the analysis.

You have the theory right when it comes to urban renewal agencies. But in practice, PDC has failed in its mission. It's basically become an isolated group of developer wannabes who drink whatever Kool-aid they're being given at the time. City Council oversight may result in a few pet projects, but more importantly it will result in some real accountability for the $250 million spent every year.

The long term solution to the affordable housing crisis is all about wages. I'd like to say that we should start spreading the wealth in this country amongst the workers who helped create it....but then we'd be sending the bulk of it to China, India, Korea, and Mexico...et al. The fact remains that when an hour's work at minimum wage will buy only a sip more than two gallons of gas; when a worker brings home $1000 a month after taxes, and rent is $600 or more....with utilities, food, clothing, etc. to budget for....well you get my drift.

Unless we all take ownership of this problem, and work to solve it without judgement and condemnation of those we consider lesser citizens that WE are (c'mon, you DO think that)...then we are headed for a Dickensian type of society. (And here we are, fresh out of newly discovered continents to ship debtors and criminals to.) The term "working poor" won't begin to cover it. And if you think the crime rate is high now, wait till we have even more folks with their backs against the wall, unable to rent a home or feed their families.

I've spent a lot of time trying to get people to look at the workers' plight. It really isn't a whole lot of use, these are the invisible Americans, the ones you can't see while you glut their labor market. I'd like to make some proposal for you Portlanders, I don't have one. We'll keep building your houses, and being invisible while you step on our heads, right up until the only affordable labor for your constricted wages will be the serfs.

It all interconnects, you do not fix little pieces and ignore the outcomes. I've watched gentrification push the workers out, I've watched their wages disintigrate, I've watched their work be devalued and college touted as the only respectable road, and it seems particularly odd when these are the people who do everything right.

Mile wrote: PDC's problem is that they never did an objective cost/benefit analysis on these projects.

I won't argue with you on that point. I often asked about cost-benefit studies while I worked at PDC. The answer was always that the project was catalytic. Never did receive a good definition for that.

I seriously doubt that you'll see any reasonable cost-benefit for City Council mandated PDC projects either. What is the cost benefit of spending 30% of the PDC budget on low income housing units (units that are likely to be rental and not result in family wealth creation through ownership).

I think that's a big part of the problem -- that low income housing is seen as rental housing (apartments) as opposed to homes.

When people have their own homes, they take a lot more pride in it and therefore are more likely to work to keep its value up (and increasing). They're also more likely to have the ability to have their own gardens, even small ones. This means they can have access to fresh fruits, vegetables and herbs that they couldn't necessarily afford at the grocery store.

It cost me around $1.50 per plant, plus some cheap planters and potting soil. I now have huge herb plants that I regularly use in our meals. I also have tomatoes and strawberries. If we had a yard (as opposed to a small patio in an apartment complex), I'd grow a lot more.

We should do more to get people into homes and not into apartments. Often times the monthly amount isn't that much more -- it's all the costs of buying the home and qualifying for the loan that are the problem. Instead of letting all those dollars go into the hands of some big company (for property they almost wash their hands of once it is built), how about putting it into homes.

At our complex, for example, the appliances appear to be from the early 80s, if not earlier. The complex owners don't have much of an incentive to replace these items, because they've long ago gotten back the cost of building these units, so every dollar they have to spend in renovations and the like cut into their profit margin.

There is no committment to providing affordable housing. There might be commendable objectives on the part of certain individuals and non-profits to increase affordable housing, but upon that component of society that could acheive it, the city, there is no committment to insure that a fair, income based balance of affordable housing will be built and made available to those that need it.

This aspect of urban planning is but a lofty dream made good occasionally, but without consistency. Downtown, around the Park Blocks, Safeway, PSU; not much of a guarantee of affordable housing there. How many units are accessible to low income people in the new Elliot condo tower, across from Portland Art Museum? I'll bet some of them work across the street at the Safeway.

The very phrase, "affordable housing" seems deceptive, considering that median family income for a family of four is accepted as $68,000. What rot. What about all those families of four that are lucky to bring in only half or less than that amount?

I suppose you can come up with a formula to make anything true. Even if it's true, it really doesn't matter, because cash poor is cash poor, and where a pattern is allowed to form, of creating an excess of housing that makes inaccessible, or virtually excludes great numbers of people of the basic means to carry out a decent existence, huge problems begin to grow.

In my few years working in local government, I have observed a few nuances when it comes to affordable housing.

Market forces
I think it's fair to point out that the public sector can never match the private sector's ability to affect the market. Today, the private market currently provides more affordable units than government does.

In addition, even nonprofit housing developers are affected by much larger market forces: construction costs, land costs, labor costs. The main difference is a commitment to long-term affordability.

Subsidy
Federal subsidy for building affordable housing has been continuously slashed over the past eight years. This has meant fewer dollars to build the ever-increasing cost of units. In addition, Low-Income Housing Tax Credits--the main source of financing affordable housing--is scarcely allocated given the demand, making it even more difficult to get the projects built.

The policy to dedicate tax-increment financing from PDC is in part a response to this federal and state scarcity.

State policy
Many cities facing the same issues as Portland have looked to inclusionary zoning as a solution. This policy requires new development to provide a certain number of long-term affordable units, whether rental or ownership. Why doesn't Portland have this? Well, we were preempted from making this local decision by the state legislature some years ago. There are folks working on changing that.

Who needs it most
By far, our greatest need for housing units are for those earning below 30% of our area's median family income. As you can imagine, these units--though costing nearly the same to build--require greater subsidy to make the rents affordable. And, of course, they are the hardest for the private market to provide.

Ownership
I think ownership is fantastic. Again, the question is one of subsidy level. If it costs $50,000 to $70,000 in subsidy to make a home affordable to the average Portlander, should that home always be affordable? I know locally, both Sabin Community Development Corporation and Portland Community Land Trust are trying to do just that: help owners build wealth, and keep homes affordable.

Jesse....It looks to me that both these entities you mention as being home ownership advocates have some real shotcomings. Both appear to focus on one group (in the photos every happy family looks Hispanic!) or on one neighborhood (Alberta...puleeeze Alberta isn't an affordable neighborhood anymore).....isn't that red-lining? A big RESPA no-no.

Also the lending requirements For their programs are so rigorous that anyone qualifying for one of these loans might as well go to their local bank. FACT: Anyone who's been working steadily at a minimum wage job is NOT going to have good credit, there will be late pays and other stresses, like medical bills. And they will be paying far more than 40% of their income on bills, debts and mortgages or rents. What planet are these non-profits living one?

There is NO affordable housing in the metro area for minimum wage workers. And there are very few funds or programs available for them. No hope on the horizon either.

WS hit the nail right on the head...there is no commitment in this town for low income workforce housing. And from the few comments this article recieved it really does seem to me that too many people are centered and focused on election politics and not what the end goals of the elected officials should be.

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